Insurers Have A Duty To Defend A Policyholder In A Wrongful Death Action Arising Out Of A Justifiable Homicide
October, 2006
New York’s Highest Court, the New York Court of Appeals, recently held that an intentional and justifiable shooting that unexpectedly resulted in death was an “occurrence” under the language of a homeowner’s policy. The Court also found that a wrongful death claim alleging negligence, which stemmed from the justifiable homicide, did not necessarily fall within the “expected or intended” injury exclusion of the policy. As such, the Court held that the insurer had a duty to defend its policyholder. Automobile Insurance Company of Hartford v. Cook, 7 N.Y.3d 131, 850 N.E.2d 1152 (N.Y. 2006).
Defendant, Alfred Cook, shot and killed Richard Barber inside the Cook home on February 20, 2002. The shooting occurred during an altercation between the two men. As Barber (who was approximately three times larger than Cook and who assaulted Cook in the past) threatened and menacingly advanced on Cook, Cook intentionally and with warning, fired a shot at Barber’s midsection. Barber died from his injuries.
After Cook was acquitted on the criminal charges by reason of self-defense, Barber’s estate filed a wrongful death action against Cook, claiming that Barber’s death was negligently caused by Cook. Defendant Cook sought personal liability coverage from his homeowner’s policy, provided by the plaintiff in this case, Automobile Insurance Company of Hartford (“Hartford”). The Policy provided coverage for an “occurrence,” which was defined by the policy as: “an accident . . . which results, during the policy period, in . . . bodily injury.” The Policy also contained an exclusion for bodily injury “which is expected or intended by an insured.” Finally, the Policy provided that Hartford will provide a defense and indemnify Cook for the amount for which Cook is legally liable “[i]f a claim is made or a suit is brought against any insured for damage because of bodily injury . . . caused by an occurrence to which this coverage applies, even if the claim or suit is false.”
Relying on the definition of occurrence, Hartford denied coverage, claiming that the shooting was not an accident and therefore was not an occurrence within the meaning of the Policy. Hartford also argued that, notwithstanding the definition of an occurrence, the incident fell within the exclusion for an expected or intentional injury, and Cook was not entitled to a defense. Hartford then commenced an action for declaratory judgment, requesting a declaration that it was not required to defend Cook in the wrongful death case.
At summary judgment, the trial court, the New York Supreme Court of Albany County, denied Hartford’s motion, finding that Hartford failed to prove that the term “occurrence” excluded Cook’s actions or that the incident was subject to the exclusion for expected or intended injuries. The trial court also noted that because the negligence allegations in the Complaint against Cook could potentially be proven at trial, Hartford had a duty to defend Cook. The New York State Appellate Division, Third Department, reversed the trial court’s order, finding that the intentional nature of Cook’s actions were not an “occurrence” as that term is defined in the Policy, and indeed, Cook’s action squarely placed the incident under the umbrella of the expected and intentional injury exclusion. Cook appealed the Appellate Division order and the Court of Appeals granted review as to the issues of whether the shooting was an occurrence that gave rise to coverage, and whether justifiable homicide fell under the exclusion of “expected or intended injury.” Ultimately, the Court agreed with the trial court decision, reversed the Appellate Court order, and held that the shooting was an “occurrence” under the terms of the Policy, was not subject to the exclusion, and Hartford had a duty to defend Cook in the underlying wrongful death case.
In rendering its decision, the Court of Appeals first focused on the insurer’s duty to defend in light of a Complaint against an insured, noting that this is a well-settled and exceedingly broad obligation. Indeed, the Court reiterated that “an insurer will be called upon to provide a defense whenever the allegations of the complaint ‘suggest a reasonable possibility of coverage.’” Cook, at 137. Moreover, referring to this duty as “litigation insurance” the Court reminded insurers that the duty to defend remains “‘even though facts outside the four corners of [the] pleadings indicate that the claim may be meritless or not covered,’” (id.) unless the insurer can “‘demonstrate that the allegations of the complaint cast that pleading solely and entirely within the policy exclusions.’” Id. In light of the nexus between the insurer’s duty to defend the insured and the basis of the claim against the insured, the Court next turned to whether or not the wrongful death Complaint against Cook was one that suggested “a reasonable possibility of coverage,” and thus triggered Hartford’s duty to defend.
Ultimately, the Court of Appeals found that if the allegations against Cook that he negligently caused Barber’s death could be proven, then the Complaint did indeed afford “a reasonable possibility of coverage.” In so doing, the Court focused on the definition of “occurrence” in the Policy, and how the term “accident,” used in the definition of “occurrence” was construed. Initially, the Court relied on a previous case in which the term “accident” was determined “to pertain not only to an unintentional or unexpected event which, if it occurs, will foreseeably bring on death, but equally to an intentional or expected event which unintentionally or unexpectedly has that result.” Id. at 137-138 (emphasis added). Significantly, this definition of accident was originally advanced in the context of a life insurance policy. However, the Court nonetheless applied this same definition of “accident” to Cook’s homeowner’s policy, and found that if Cook did negligently cause Barber’s death, then the incident fell under the umbrella of an “intentional or expected event which unintentionally or unexpectedly” resulted in death. Id. at 138. To that extent, the shooting at Cook’s house would indeed be an “occurrence” under the Policy, providing Cook with coverage for the incident and triggering Hartford’s duty to defend.
In view of the fact that the shooting -- if proven to be an accident -- would be covered under the policy as an “occurrence,” the Court next turned to the question of whether the expected or intended injury exclusion precluded coverage under Cook’s homeowners policy, thus releasing Hartford from its duty to defend. Summarily dismissing Hartford’s argument that the exclusion applies to the negligence claim against Cook, the Court stated that “an allegation of negligence implies an unintentional or unexpected event.” Id. Thus, it is manifest that an exclusion for an intended or expected event does not exclude an “unintentional or unexpected event,” and therefore, the negligence claim against Cook was not subject to the exclusion. The Court concluded that, in light of the foregoing, Hartford was obligated to defend Cook in the underlying wrongful death action.
Learning Point: In determining whether an insurer has a duty to defend a policyholder, courts will look to the basis of the claim against the insured and whether that claim can potentially be proven. In the context of a wrongful death action, when the Complaint against the insured includes a negligence claim and that claim suggests “a reasonable possibility of coverage,” a homeowner’s policy that provides coverage for an accident will trigger the insurer’s duty to defend the insured in the underlying lawsuit.
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